Ian Mulgrew: Reform or die, report tells legal profession

Ian Mulgrew, Vancouver Sun columnist06.19.2013

There is a glut of lawyers, according to a new report from the Canadian Bar Association. The profession has been growing at five times the rate of the population since 2000, and one in five lawyers works for a government agency.

Many lawyers will be out of work if the profession doesn’t consider radical reforms of how it does business in the face of 21st-century challenges and consumer anger.

A thoughtful new 44-page report by the Canadian Bar Association warns that the country’s 37,000 legal professionals, about 10,000 of them in B.C., are in big trouble.

The short-term outlook is bleak: earnings will be flat or plummet, corporations will chop legal spending by one-third to one-half, and mid-sized law firms could disappear.

Called the Legal Futures Initiative, the report synthesizes seven accompanying research studies in an attempt to stimulate discussion. Recommendations and a strategy for change will follow in the summer from the profession’s political arm.

The central message is loud and clear: globalization, new technology and public frustration demand change.

At the same time, there is a glut of lawyers. The profession has been growing at five times the rate of the population since 2000, and one in five lawyers works for a government agency.

Fed up with archaic rules and legal bills that are too high and too difficult to control, corporate and individual clients want lawyers to change what they do and how they do it; how much they charge and how they charge for it.

They want more fixed-rate services and more say in the management of their files.

“With more choice and access to technology-based solutions, clients have been emboldened to question the basic value proposition of lawyers and the cost of legal services. There has also been a change in client expectations of their legal service providers. Aside from better prices, clients want more information on services, more involvement in decision-making and greater knowledge of the risks and potential outcomes of various legal strategies.”

The monopoly that lawyers have enjoyed is ending. There has been a growth in paralegals, global legal publishers, legal process outsourcers, virtual law firms and publicly traded law firms, and a host of other changes are occurring.

“Alternate business structures which feature non-lawyer ownership are already legal in England and Wales as are publicly-traded firms in various jurisdictions outside Canada,” the report notes.

“Canadian law firms, large and small, and sole practitioners will have to consider new options for operating in a changing marketplace.”

The report says this is an opportunity for the profession to “reinvent itself and thereby ensure that it remains dynamic and confident.”

“For example, the future could see the development of a full-blown, technology-enabled legal marketplace, including virtual law firms,” it suggests.

“The growth of artificial intelligence could replace lawyers for many tasks such as ‘assisted discovery’ and eventually even advice, at the same time saving clients both time and money.”

We could hope!

The association, however, has been talking about change now for several years in various documents.

Like the reforms necessary to improve access to justice, the problems are easier identified and endlessly discussed than fixed.

One hurdle is trying to have a national discussion when the profession is structured provincially.

Also, in terms of alternative business arrangements, in Canada we regulate lawyers, not law firms. That shift alone poses a whole range of complications about multi-jurisdictional practices and the role of a firm in ethical or other misconduct issues.

Moreover, lawyers as a group are far from a homogeneous gang — they’re independent, independently minded professionals involved in different legal fields, jurisdictions and markets.

Still, the data and the research being generated is making it more and more difficult for lawyers, judges and policy-makers to keep their head in the sand.

Planning and decision-making have long been hampered by a lack of hard data on the legal industry in Canada. While data does exist, here and there, there is no organization responsible for capturing the information that firms, industry and government need.

“Without hard information, key decisions are often made on anecdotal information or precedent,” the report pointed out.

“Imperfections in the marketplace in the past may have masked and protected against errors created by such less rigorous processes. As the market share of the industry declines and excess capacity appears, fact-based decisions will become more and more necessary.”

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Ian Mulgrew: Reform or die, report tells legal profession

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